Who and What is the IRS?

Historical Note

History & New Evidence that it is a foreign agency.

By Dan MeadorApril 1, 2000

"Evan" (Internet name) forwarded the following article
by Bill Cooper, published in the September 1995 issue of Veritas Magazine.
As I understand it, Wayne Bentson of Arizona was largely responsible for
research referenced in the article.

Since I'm suffering the fatigue of not getting home from Tulsa until the
wee hours of the morning, and can't seem to get kick-started to do what I
should be doing, I'm going to take the opportunity to provide context for the
lengthy Cooper article, and add information gleaned from research since. For
those who haven't seen it, the Cooper article should be enlightening.
Additionally, evidence revealed in my portion of this compiled article is
going to floor many readers. However, before disclosing new evidence, I'm
going to present something of a history.

Gail and I had just finished what we called the "monster" tax index when
someone sent the Cooper article via FAX shortly after it was published in
September 1995. Our index went through the Internal Revenue Code
section-by-section, listing regulations as they appear in the Parallel Table
of Authorities and Rules, then we listed the regulation headings for the
regulations. Because of our index, I was able to verify many of the references
in the Cooper article without having to go to actual texts, and what I found
was that many Cooper-Bentson conclusions were verified by the index. Of
particular importance, we found that there are no implementing regulations for
26 U.S.C. Section 7621, which authorizes the President to establish revenue
districts. Consequently, there are no revenue districts in States of the
Union.

However, there was a significant gap in Cooper-Bentson research. At that
point, they hadn't found origins of the Bureau of Internal Revenue, Puerto
Rico. I documented it in late 1998 even though I knew where to look when I
read the Downs v. Bidwell decision in 1997: The first civil governor of Puerto
Rico established five bureaus in the Puerto Rico Dept. of Treasury on May 1,
1900. The five bureaus were eventually to become the Bureau of Internal
Revenue, Puerto Rico, predecessor to the Internal Revenue Service. The name
change of BIR to IRS was in 1953 in advance of implementing the Internal
Revenue Code of 1954, based on Reorganization Plan 26 of 1950 and
Reorganization Plan 1 of 1952. Early Puerto Rico legislation, beginning with
the gubernatorial and executive committee acts of May 1900, are published in
Senate Documents for the period, so it's just a matter of going through the
publications to complete the merger history. Bentson and Cooper located
origins of the Bureau of Internal Revenue, Philippines, and the Philippines
special fund, in 1904 documents. The Philippines gained independence in 1946,
leaving BIR, Puerto Rico as the only Bureau of Internal Revenue that was
legislatively created, and not by Congress at that. The first Puerto Rico
legislature in 1901 legislatively enacted executive acts of May 1900.

In 1934, Congress stipulated that the various special funds maintained by
the Department of the Treasury would be known as trusts, i.e., Philippines
Trusts ! & 2, and Puerto Rico Trust 62, all three of which are still in
the books in Title 31 of the United States Code.

In his article, Cooper cites the Federal Register and the Internal Revenue
Manual acknowledgment that Congress never created a Bureau of Internal
Revenue. Someone else has since located a Supreme Court decision where
justices of the Supreme Court affirm that Congress never created a Bureau of
Internal Revenue or Internal Revenue Service. Consequently, IRS has no lawful
authority to enforce anything in the Union as Congress is charged with
responsibility for establishing any government department or agency that the
Constitution itself does not establish.

At the tail end of this article, we're going to share disclosures attorneys
in Illinois and Idaho have secured that constitute astounding revelations that
should give everyone cause to rethink strategy relating to the Internal
Revenue Service. Read on. I will continue the account of the research effort
that lays the factual foundation.

In the historical account by the Commissioner of Internal Revenue published
in the Federal Register and the Internal Revenue Manual, the Commissioner
alleges that Congress clearly intended to create a Bureau of Internal Revenue
in 1862 legislation that established the office of the Commissioner of
Internal Revenue. But reading the 1862 legislation reveals that there was no
need for a Bureau of Internal Revenue or Internal Revenue Service. Congress
established the offices of assessors and collectors, with one of each to be
appointed for each revenue district. These offices were on the order of
current U.S. Attorneys appointments. They were political patronage positions.
The offices continued to exist until implementation of Reorganization Plan 26
of 1950.

In order to understand what happened via the reorganization plans behind
the current Internal Revenue Code, we need to review what happened with
respect to prohibition.

In 1933, the Twenty-first Amendment repealed the Eighteenth. However,
Federal enforcement people continued to enforce state laws relating to alcohol
to the point of the Constantine decision in December 1935. In the decision,
the Supreme Court said that once the Eighteenth Amendment was repealed, State
and Federal enforcement ceased to have concurrent jurisdiction for enforcement
of alcohol-related laws as the Eighteenth Amendment contained the grant of
authority. Once it was repealed, concurrent jurisdiction was repealed.

Until summer 1935, the Feds had operated on the alcohol administration act
of 1926. That was replaced by the Federal Alcohol Administration Act of 1935,
enacted that summer several months in advance of the Constantine decision. In
the wake of the Constantine decision, a director was appointed, but the
Federal Alcohol Administration wasn't established to administer the Alcohol
Administration Act. Via Reorganization Plan 3 of 1940 administration of the
Federal Alcohol Administration Act was transferred to the Bureau of Internal
Revenue, predecessor of the Internal Revenue Service.

As the Cooper article suggests, BIR, Puerto Rico and/or BIR, Philippines
had already encroached into States of the Union via China Trade Act
legislation, which implemented maritime (customs) laws relating to trade in
opium, cocaine and citric wines. The first drug-related law was passed in
1914, then with the 1918 amendment, the Feds began to enforce drug laws in the
several States.

The timing was ideal. There was significant political mobilization
responsible for the Eighteenth Amendment and alcohol prohibition, so the Feds
took advantage of empathy for purging any kind of intoxicating substance. In
his letter supporting the 1940 Reorganization Plan, Roosevelt said that BIR
had been enforcing provisions of the Federal Alcohol Administration Act,
anyway, so the transfer of responsibility didn't effect significant change.

Some time before Cooper wrote his article, I read the 1992 New York v.
United States decision. In the decision, the Supreme Court used the term
"Cooperative Federalism".

My response was, "What the hell is Cooperative Federalism?"

The next time I saw published use of the term was in the title of an
article in the 1992 edition of The Book of the States. In the meantime, I ran
across the "Federalism" executive order Ronald Reagan put in place. The Reagan
order, which technically preserves constitutional integrity, is the one Bill
Clinton keeps trying to overhaul, but he is getting considerable resistance.
This particular executive order is an executive policy statement, it doesn't
meet standards of 3 U.S.C. Section 301 and the Federal Register Act. It is
simply the prevailing policy statement that informally shapes relations
between State and Federal governments.

Now we have two essential identifying terms: On the Federal side,
"Federalism", and on the State side, "Cooperative Federalism".

Let's address the scheme of things through two constitutional questions:
Have Article I 8, clauses 5 & 6 and Article I 10, paragraph one of the
Constitution been repealed or amended? Has the Constitution been amended to
effect prohibition against opium, cocaine, and other such substances?

We'll follow those questions with two more: Do we have gold and silver coin
as our national currency? Do we have national prohibition against drugs?

In light of the first two questions, we can conclude that Congress has
defaulted responsibility for providing a national currency of gold and silver
coin, and our States of the Union are accommodating the fraud without a
constitutional amendment; and in light of the second question, we can conclude
that Federal government is exercising a power which is not enumerated in the
Constitution, and our respective state governments are accommodating the
usurpation of power.

Obviously, the Federal Reserve Act of 1913 was patently unconstitutional.
At least it was if it applied to Union. But it might not be if it applied to
United States Government itself, and territories and insular possessions of
the United States. Likewise, the Federal drug laws would be legitimate if they
applied to the District of Columbia and insular possessions of the United
States. It is here that Congress has plenary or near-absolute power. And we
can lengthen the list. The Federal Alcohol Administration Act is legitimate in
Puerto Rico, but not Oklahoma. Likewise, the Social Security Act of 1935 is
legitimate in Puerto Rico, the Virgin Islands, etc., but not in Kansas. Where
the latter is concerned, we see proper geographical application in definitions
of "State", "United States" and "citizen" at 26 CFR §31.3121(e)-6.

At the January 1937 general conference of the Council of State Governments,
delegates from a majority of our state legislatures endorsed the Declaration
of Intergovernmental Dependence. This formalized what was already a working
arrangement. States of the Union formally went on the Federal dole system, and
by setting up the infrastructure, provided a forum for general agreement among
state governing bodies as to what Federal encroachment they would accommodate.

Here are more relevant questions: Does the executive branch have
legislative authority? Can the President unilaterally repeal law once it has
been formally enacted by Congress?

Via Reorganization Plan 3 of 1940, Roosevelt reassigned duties of the
Federal Alcohol Administration to BIR, thereby abandoning the agency Congress
established, then via Reorganization Plan 26 of 1950, Truman effectively
terminated the offices of assessor and collector Congress established in 1862,
In other words, after the Supreme Court determined that Federal enforcement
agencies had no authority to enforce state alcohol law in the several States,
administration of the Federal Alcohol Administration Act was moved under
authority of the Bureau of Internal Revenue, Puerto Rico for administration in
insular possessions of the United States. By law, BIR, Puerto Rico could not
be exercised in the Union, but since State governments were willing to
accommodate Federal encroachment in return for whatever financial incentives
Federal government provided, the fraud was and has generally been
accommodated. The scheme worked well enough that in 1950, Truman followed the
Roosevelt lead by authorizing BIR, i.e., IRS administration of Federal income
tax law. But the geographical application remains the same, limited to the
District of Columbia and insular possessions of the United States.

Through their gross income "source" research, Tupper Sausie, Thurston Bell,
Larken Rose and various others have documented that the American people in
general are liable for Federal income tax, but are liable only on income from
foreign sources and insular possessions of the United States. These
conclusions reinforce and are consistent with my research and research by
Bentson and Cooper. With enactment of the Internal Revenue Code of 1954, via
Truman executive orders, the offices of assessor and collector of internal
revenue were terminated, and administration of the Internal Revenue Code, by
appearance, was turned over to the Internal Revenue Service, an agency of the
Department of the Treasury, Puerto Rico.

We need to address one more entity, the "United States of America".

What is the United States of America? As it turns out, there are two
entities called the "United States of America". The first and original,
mentioned in the Preamble and Article II of the Constitution of the United
States, was formally created in the Articles of Confederation. But some time
after the Civil War, probably early in the twentieth century, a second "United
States of America" came into being. The second is a political alliance or
compact of the insular possessions of the United States.

Here I'm going to introduce evidence secured by John M. Ohman, an Idaho
Falls, Idaho attorney. In the case styled Diversified Metal Products, Inc. v.
T-Bow Company Trust, Internal Revenue Service, and Steve Morgan, case
CV93-4117, filed in the District Court of the Seventh Judicial District of the
State of Idaho, the Booneville County Magistrates Court, Ohman filed an
impleader petition.

Diversified Metal was served a notice of levy for money owed to the T-Bow
Trust. In order to determine rightful ownership, Ohman filed the interpleader
action on behalf of Diversified Metal. In his complaint, he stipulated facts.
His fact #4 is as follows: "Defendant Internal Revenue Service (IRS) is an
agency of the United States government(tm)"

In her January 24, 2000 response, U.S. Attorney Betty H. Richardson made
the following correction to Ohman's averment: "Denies that the Internal
Revenue Service is an agency of the United States Government but admits that
the United States of America would be a proper party to this action."

This is something I've tried to impress on people for most of two years,
but few grasp the implications: The Constitution of the United States creates
and vests authority in a governmental entity known as the "United States" or
"United States Government." While it is "for" the United States of America,
the Constitution vests absolutely no authority in the United States of
America. Any time the United States prosecutes as case, whether civil or
criminal, it must be in the name and by authority of the United States, not
the United States of America. The only place the "United States of America"
has any standing is in territorial courts in insular possessions of the United
States, then the styling must be, "United States of America, ss, President of
the United States". See title 48 of the United States Code for particulars
relating to Puerto Rican and Virgin Islands courts.

If we read notes following the current 18 U.S.C. Section 1001, we find that
the "United States of America" is currently defined as an agency of the United
States. In the context of the Downes v. Bidwell decision, we find that these
insular possessions, which are not incorporated in the constitutional scheme,
are "foreign" to the United States, i.e., to the Union of States. Therefore,
this political alliance or compact known as the United States of America,
which first appeared in 1918 legislation, is a government foreign to the
United States and the several States even though the member insular
possessions belong to the United States.

The Richardson correction above verifies that the Internal Revenue Service
is not an agency of United States Government, but the United States of
America, clearly a distinct and different entity, would be a party of
interest. It would be difficult to be any clearer on the subject, and the
Rechardson correction tells us that people such as U.S. Attorneys, attorneys
in the Department of Justice, and Federal judges are fully aware of the
difference.

Michael Bufkin, a Dundee, Illinois attorney, undertook a delightful
project. On December 18, 1998, he sent a Freedom of Information Act request to
the Department of the Treasury asking for documentation of authority for the
Department of Justice to defend Internal Revenue Service personnel in civil or
criminal cases. In an August 2, 1999 response, Leslie Howard in the national
IRS office responded with the following: "A search was performed with the
Office of Tax Crimes (Criminal Investigation) and with the Assistant Chief
Counsel (Disclosure Litigation) and we have no documents responsible to your
request. However, you may forward a copy of your request to the U.S. Attorney
General's Office within the Department of Justice."

Bufkin did just that. In response to his September 21, 1999 FOIA to the
Attorney General, Thomas J. McIntrye informed Bufkin that, "We have conducted
a search of the appropriate indices to Criminal Division records and did not
locate any records responsive to your request."

We don't know who has lawful authority to defend IRS personnel, but the
Department of Justice and U.S. Attorneys don't. Possibly the foreign "United
States of America" that is principal of interest and benefits from IRS
initiatives has a raft of attorneys ready to defend these foreign agents.

As chance would have it, one of the people in our group recently received
certification of documents on IRS Austin Region stationary that is headed,
"United States of America, Department of the Treasury, Internal Revenue
Service". The certification letters are dated November 16, 1999.

What we are dealing with amounts to invasion of a foreign government
accommodated by our respective State governments. However, thanks to the
diligence of people approaching IRS tyranny from several directions, we about
have the whole nut documented and broken down.